Cerner Corp. (CERN) approved a 22.2% hike in its quarterly dividend to $0.22 per share. The healthcare technology company said that the new dividend will be paid on Jan. 12, 2021, to shareholders of record as of Dec. 28, 2020.
Cerner’s annual dividend of $0.88 per share now reflects a dividend yield of 1.2%. The company said, “Cerner intends to pay regular quarterly cash dividends, with future declarations subject to Board approval and their determination that the declaration of dividends remains in the best interests of Cerner and its shareholders.”
On Oct. 28, Cerner reported 3Q earnings of $0.72, which grew 9% and topped the Street’s estimates of $0.71 per share. The company’s 3Q revenues of $1.37 billion were in-line with the Street’s estimates but declined 4% year-over-year. (See CERN stock analysis on TipRanks)
Piper Sandler analyst Sean Wieland raised the stock’s price target to $84 (12.7% upside potential) from $81 and maintained a Buy rating on Oct. 30. The analyst believes that Cerner’s profitability could continue to improve and that the company’s cost structure could benefit the company’s operating margin by 500-800 basis points.
Meanwhile, most of the Street firmly shares Wieland’s bullish outlook on the stock. The Strong Buy analyst consensus is based on 7 unanimous Buys. The average price target stands at $81.29 and implies upside potential of about 9.1% to current levels. Shares were up by 1.5% year-to-date.